Corporate carbon footprint

The ifeu has been providing consulting services on environmental balances for the business sector for many years. Corporate environmental balances include the analysis and quantification of the environmental impacts of business activities and consider a number of relevant environmental impact categories. However, climate change has been the key priority in recent years due to its global and irreversible effects, and there is considerable public interest in the required substantial reductions of greenhouse gas emissions.

For a long time, the media portrayed major summits such as the UN Climate Change Conferences, and thus climate change mitigation as the primary responsibility of nation states. More recently, there have been efforts to oblige individual businesses to engage in climate change mitigation due to the fact that the majority of anthropogenic greenhouse gas emissions in industrialised countries with a market economy structure arise from corporate sources. However, all acceptance of responsibility is based on a clear understanding of the consequences of actions. For this purpose, many companies work with corporate carbon footprints that allow the analysis and quantification of the impacts of corporate activities.

Several years ago, most companies solely considered direct emissions of their own specific activities (scope 1), and the emissions from the electricity consumption associated with these (scope 2). Nowadays, it is more and more common for businesses to accept the challenge of including all relevant emissions along the entire value chain (scope 3). The consideration of these indirect emissions is vital for a transparent communication with stakeholders with diverse expectations, particularly for processing businesses and the finance and trade sector. Thus, suspicions of greenwashing may be avoided.

The calculation of a corporate carbon footprint is only the first step, the characterisation of the status quo. Based on the outcome, specific reduction targets as a contribution to climate change mitigation should be identified.
In addition to expectations of society in general and consumers, politics, investors and well-known environmental NGOs in particular, a number of additional specific drivers influence corporate carbon footprinting:

CDP: The CDP (former Carbon Disclosure Project) is a non-profit organisation representing a number of major investors (e.g. Bank of America, Allianz SE) and influential buyers (e.g. Walmart, The Coca-Cola Company) that requests companies to complete an annual questionnaire disclosing information on corporate carbon footprints among other corporate information.

Sustainability stock indices: Both the Dow Jones Sustainability Index and the FTSE4GoodIndex are among the prime examples. They both include corporate greenhouse gas emission rates in their ratings.

GHG Protocol Initiative: An initiative of the World Resource Institutes (WRI) and the World Business Council for Sustainable Development (WBCSD), which developed the most widely used standards for current corporate carbon footprinting.

Science-based Targets Initiative: A collaboration of CDP, WWF, UN Global Compact and WRI promotes long-term reduction targets for companies in accordance with state-of-the-art climate science, for the purpose of making a fair contribution to the achievement of the 2°C target.

Global Reporting Initiative (GRI): The GRI is a non-profit organisation responsible for the publication of the most widely used framework for the calculation of sustainability reports worldwide. Guidelines for the publication of results of corporate carbon footprints are part of this framework.

References

Over the years, the ifeu has provided consulting services on the quantification and evaluation of environmental impacts for various clients, thus supporting climate change mitigation. The following examples are particularly relevant for corporate carbon footprinting:

Extensive long-term consulting for a major American corporation (emission factors, implementation, inventory boundaries, recalculation policy, processes and structures, professional development, characteristics of the inventory of scope 2 and 3, etc.)

Verification of the carbon footprint of a leading European retail chain with subsequent ongoing consulting

Consulting for and participation in the environmental balance of Bertelsmann

Consulting for an international packaging corporation for the calculation of an in-depth corporate carbon footprint (incl. all three scopes) as well as the definition of science-based reduction targets